Redundancy and suitable alternative employment
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| Introduction |
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| Section 141 of the Employment Rights Act 1996 governs the rules on suitable alternative offers of employment in relation to redundancies. This article deals only with alternative employment as a substitute for redundancy. We have separate articles on redundancy and unfair dismissal. This article will be useful reading to all employees who fear they might lose their job through redundancy and all employers who are considering making an employee redundant. |
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| Before redundancy |
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| Before an employee is made redundant, the employer should consider whether there are other jobs available which the employee would be capable of doing. If such suitable employment is available, it should be offered to the employee. If it isn't offered, the employee is likely to be able to make a claim for unfair dismissal. |
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| Alternative job offer |
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| The offer of alternative employment must be made before the current job ends. It can be made in writing or verbally. Of course, a written offer is always preferable. |
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| The job offer must provide the employee with enough details about the new job so that they can assess the differences between their existing job and the new job. The employee must also be offered a trial period in the new job. |
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| Is this job suitable? |
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| Whether an alternative job offered is suitable depends on the terms of the job offered and the employee’s skills, abilities and circumstances. Factors such as pay, status, hours and location are relevant when deciding whether a job is a suitable alternative. The employer does not have to offer a similar position or a position in the same workplace. |
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| Refusal on the grounds that the new job would mean moving house or lead to a significant change in working hours which did not fit with personal circumstances, would be acceptable. Refusal of a similar job without even looking into it would be unacceptable. An employee who refuses a suitable alternative may lose their entitlement to redundancy pay. |
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| Work would normally be regarded as unsuitable if it meant changes in: |
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- Pay;
- Travelling time;
- Skill requirements;
- Status.
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| More than one alternative |
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| An employer may offer the employee a number of alternative jobs. Each offer must give sufficient detail, as mentioned above. |
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| Trial period |
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| For each alternative job, the employee is entitled to a trial period of four calendar (not working) weeks, without losing the right to statutory redundancy pay. The trial period will start immediately once the previous job has ended. At any time during the period the employee can decide that the job is unsuitable. However, if an employee unreasonably refuses the alternative job after the trial period, they will not be entitled to a statutory redundancy payment. |
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| The employer can also assess the employee during this period to appraise their suitable for the new role. This period can be extended (by written agreement) for retraining. If the employee works beyond the length of time agreed by both the employer and the employee, any redundancy entitlement will be lost because it will be seen as the employee having accepted the new job. |
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| If an employer refuses a trial period the employee can claim unfair dismissal. An employee, who decides not to accept the alternative, before actually starting a new job, does not in principle, forfeit redundancy pay. |
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| Rejecting suitable alternative work |
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| Refusing an offer of suitable alternative work will result in forfeiting redundancy pay - if employees do not respond to an employer’s offer of alternative work, the tribunal will interpret this as an unreasonable refusal which will preclude the right to redundancy pay. |
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